Transforming Industry through CCUS

Table of contents

Executive summary..........................................................................................................................................

5

Findings and recommendations ........................................................................................................................

7

Policy recommendations ...........................................................................................................................................

7

CCUS can support sustainable and competitive industry ............................................................................................

7

Industry drives economic growth and development ...................................................................................................

8

One-quarter of CO2 emissions are from industry ........................................................................................................

9

Industry emissions are among the most challenging to mitigate ..............................................................................

10

Without action, industry emissions could derail climate goals ..................................................................................

11

CCUS is central to the industry decarbonisation portfolio.........................................................................................

12

CO managementbecomesintegraltoindustrialproduction ...................................................................................

14

CCUS cuts the cost and complexity of industry transformation ................................................................................

15

References

..............................................................................................................................................................

15

A spotlight on the industry sector ...................................................................................................................

16

Industry central to economic growth and development ...........................................................................................

16

Industrial emissions and energy demand .................................................................................................................

18

China leads the industrial growth story ....................................................................................................................

20

The CO2 emissions abatement challenge .................................................................................................................

22

Rising to the challenge: The role of CCUS ................................................................................................................

25

References

..............................................................................................................................................................

29

Towards a sustainable and competitive industrial transformation......................................................................

31

Without action, industrial emissions will exceed total emissions in the CTS...........................................................

31

Targeting industrial emissions in the CTS.................................................................................................................

34

Decarbonising industry: the role of CCUS in the CTS................................................................................................

35

The implications of limiting CCUS in industry...........................................................................................................

46

Lower-cost opportunities for CCUS: Fuel transformation .........................................................................................

47

Prospects for hydrogen in industry ..........................................................................................................................

48

Carbon capture and utilisation................................................................................................................................

50

References

..............................................................................................................................................................

51

Conclusions and policy recommendations........................................................................................................

53

Accelerating technological and business innovations for CCUS ................................................................................

53

References

..............................................................................................................................................................

57

Acknowledgements, contributors and credits ..................................................................................................

58

List of figures

Figure 1.

CCUS emissions reductions by subsector in the CTS, 2017-60...................................................................

8

Figure 2.

Global trends in the production of major industrial products, GDP and population over the previous

four decades ............................................................................................................................................

9

Figure 3. Direct CO2 emissions by sector, 2017......................................................................................................

10

Figure 4. Process emissions from selected industry subsectors .............................................................................

10

Figure 5. Lock-in of current infrastructure ............................................................................................................

11

Figure 6.

Industry emissions pathway in the RTS compared with overall CTS emissions ........................................

12

Figure 7.

Emissions reductions for key industry subsectors (cement, iron and steel, chemicals) by mitigation

strategy, CTS compared with RTS, 2017-60............................................................................................

13

Figure 8.

Global cumulative direct CO2 emissions reductions in cement, iron and steel, and chemicals in the

CTS, 2017-60 .........................................................................................................................................

13

Figure 9.

CO captureincement,ironandsteelandchemicalsubsectorsin theRTSandCTS,todaythrough

2060 ......................................................................................................................................................

14

Figure 10.

Global trends in the production of major industrial products, GDP and population over the previous

four decades ..........................................................................................................................................

17

Figure 11.

Apparent per-capita material consumption and per-capita GDP for selected countries, 2000-17.............

17

Figure 12.

CO2 emissions by sector, 2017................................................................................................................

19

Figure 13.

Industry subsector final energy demand and direct CO2 emissions, 1990-2017........................................

19

Figure 14.

Fossil fuels in global industrial final energy demand, 1990-2017 (left), and final energy demand by fuel

for selected industry subsectors, 2017 (right)..........................................................................................

20

Figure 15.

Industry subsector final energy consumption and direct CO2 emissions by region, 2017..........................

21

Figure 16.

China’s production of iron and steel, cement and selected petrochemicals, 2017 ....................................

21

Figure 17.

Industry fuel use in selected regions, 2017 ..............................................................................................

22

Figure 18.

Process emissions from selected industry subsectors .............................................................................

23

Figure 19.

Heat demand by industry and temperature level....................................................................................

23

Figure 20.

Lock-in of current infrastructure ............................................................................................................

24

Figure 21.

Large-scale CCUS projects worldwide ....................................................................................................

25

Figure 22.

CO2 captured at large-scale CCUS facilities globally by sector ................................................................

26

Figure 23.

CO2 emissions in the RTS and CTS by sector ..........................................................................................

32

Figure 24.

Global final energy use and CO2 emissions in industry in the RTS, 2017-60 .............................................

32

Figure 25.

Industry emissions pathway in the RTS compared with overall CTS emissions ........................................

33

Figure 26.

Global direct CO2 emissions by industry subsector in the CTS, 2017-60...................................................

34

Figure 27.

Share of global direct CO2 emissions by industry subsector, today (left), and emissions reductions for

the three focus subsectors by mitigation strategy, CTS compared with RTS, 2017-60 (right) ..................

35

Figure 28.

CCUS contribution to emissions reductions by sector, 2017-60...............................................................

36

Figure 29.

CO capturein cement, iron and steel and chemical subsectors in the RTS and CTS, today through

2060 ......................................................................................................................................................

37

Figure 30.

Captured CO2 in industry by region in the CTS, 2025-60 .........................................................................

38

Figure 31.

Global cumulative CO2 emissions reductions in cement production by abatement option from RTS to

CTS, 2017-60 .........................................................................................................................................

39

Figure 32.

CO2 capture in cement production under the CTS by technology............................................................

40

Figure 33.

Global cumulative direct CO2 emissions reductions in iron and steel under the CTS, 2017-60 ..................

43

Figure 34.

Global cumulative direct CO2 emissions reductions in the chemical subsector in the CTS, 2017-60..........

45

Figure 35.

CCUS deployment in the chemical subsector in the CTS and RTS, 2017-60 .............................................

46

Figure 36.

Captured CO2 for storage by industry sub-sector and for utilisation by scenario......................................

47

Figure 37.

Direct CO2 emissions reductions for fuel production and transformation sectors by mitigation

strategy, CTS compared with RTS, 2017-60 ..........................................................................................

48

Figure 38.

Simplified levelised cost of ammonia via various pathways ....................................................................

49

Figure 39.

Break-even costs for CO2 capture and storage by application .................................................................

55

Box 1.

Categorising industrial CO2 emissions ....................................................................................................

18

Box 2.

Industrial CCUS hubs in the United Kingdom, Australia and the Netherlands..........................................

28

Box 3.

Scenarios discussed in this analysis ........................................................................................................

33

Box 4.

Carbon capture technology options .......................................................................................................

36

Box 5.

Cement production and CCUS: An introduction .....................................................................................

41

Box 6.

Status of CCUS in iron and steel .............................................................................................................

44

Box 7.

Beyond electricity: Private procurement of low-carbon industrial products ............................................

54